March 18, 1948

PC

Charles Cecil Ingersoll Merritt

Progressive Conservative

Mr. MERRITT:

I will answer the hon. member. As a matter of fact, in the case cited by the hon. member for Kindersley, Bowles vs. The Bank of England, this kind of tax was held unconstitutional and in direct defiance of the Bill of Rights by an English court. In his judgment the learned judge doubted whether there was any process of law which would enable a person so taxed to recover what he had paid. If the hon. member wants an answer to the question the best I can do is quote the only authority I know, which indicates doubt whether there is any process which would enable any person to recover his tax.

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LIB

Hughes Cleaver

Liberal

Mr. CLEAVER:

I read the authority to which my hon. friend referred, a quite recent case, with judgment given in 1913, I believe; and my understanding of that authority

I shall read it again, of course-is that there was a distinct ruling by the court that no tax was imposed until parliament passed the taxation measure. I contend that mjf hon. friends across the way fail to distinguish between the imposition of a tax and the notification that parliament will be asked to impose a tax. I add that the extent to which the public and business generally in this country have responded to the minister's announcement,

Excise Tax Act Amendment

and have paid and collected this tax, is an indication of what? It is an indication of the confidence business in this country has in an announcement by a minister of this government. If they had no confidence in the ability of the minister to have parliament implement that announcement by the actual imposition of the tax, then the business life of this country would have rebelled, if they had felt safe in doing so. They would have said. "We will not collect the tax. It is not imposed yet, and it never will be imposed". We all agree that only parliament can impose it, but who can show me anything unconstitutional in parliament making a tax retroactive? My hon. friends are driven to argue that the parliament of Canada cannot impose a tax retroactively, if they are to support all these arguments we have heard tonight.

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PC

Charles Cecil Ingersoll Merritt

Progressive Conservative

Mr. MERRITT:

I see the Secretary of State for External Affairs in the chamber. He was formerly the Minister of Justice and, as everyone knows, is a distinguished lawyer. The Minister of Justice is not here at the moment, nor is the Prime Minister. I think the committee is entitled to hear from both those right hon. gentlemen on this point, but I wonder if the Secretary of State for External Affairs would say whether, in his opinion, the procedure followed of announcing and collecting the tax, while parliament was not in session, is in keeping with the Canadian constitution.

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LIB

William Henry Golding (Deputy Chair of Committees of the Whole)

Liberal

The DEPUTY CHAIRMAN:

The hon. member for Vancouver East.

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?

Some hon. MEMBERS:

Answer.

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CCF
PC

James MacKerras Macdonnell

Progressive Conservative

Mr. MACDONNELL (Muskoka-Ontario):

I had no intention of speaking further, but after listening to the hon. member for Van-couver-Burrard; after realizing that apparently this matter is regarded as a joke by a good many people on the other side of the house, since I regard it as a serious matter I determined to say a few words about it. Speaking as one Mac to another, it was refreshing to hear a little wave of common sense after all this talk. The hon. member for Vancouver East made it clear when a tax is a tax, and got away from all this hair-splitting that there is no tax and that you do not need to pay the tax, when here we have an instruction which has gone out to every customs inspector, and when instances have been given in this house where goods could not be brought in without the tax being paid. So is it not time we stopped1 talking about there being no tax? Let me say this: We have

had1 a lot of talk in here about a long word called "constitutionality. I want to talk about a very short word called "law." This tax-and it was a tax, and intended to be a tax, and collected as a tax, and accepted by the people of Canada as a tax-was a lawless tax.

In the house yesterday we were in- general agreement, everyone was talking about a group of people in this country who believe in lawlessness, who are going to try to practise lawlessness and to destroy our dearest privileges and our way of life. What do we find here? We find, first of all, and for no valid reason at all-because no reason has been given; the reasons given, or supposed to be

Excise Tax Act Amendment

given by the hon. member for Halton the other night were frivolous in the highest degree -we have lawlessness.

Let me read the words used in this House of Commons some years ago by the present Prime Minister; and then see if members opposite will laugh that off, as they tried to laugh off what was said earlier in the evening. This is what the Prime Minister said, speaking in the House of Commons in 1931, as reported at page 4413 of Hansard for that year:

The fundamental tradition in all that pertains to responsible government is that the people's representatives in the House of Commons must exercise control over taxation and that that right must never be taken away from them.

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?

An hon. MEMBER:

What is the matter with that?

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LIB

Douglas Charles Abbott (Minister of Finance and Receiver General)

Liberal

Mr. ABBOTT:

Of course.

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An hon. MEMBER:

We all agree with that.

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PC

James MacKerras Macdonnell

Progressive Conservative

Mr. MACDONNELL (Muskoka-Ontario):

You all agree with it, in words; but in action, it was not done.

The minister said tonight; he has been frank tonight in saying that he does not know how far back you can go before parliament is summoned. In this instance it was three weeks. He has been frank enough to say that he does not think three weeks is the limit. I think he said it might be three months. I do not see why, on the same reasoning, it should not be six months.

I am surprised and disturbed that hon. gentlemen opposite, whom I respect, do not seem even willing to look at this question. They seem to be ready to put it aside and to deal with it as if there were no substance involved in it. If you can impose a tax of this kind-and it is a tax-then the people of Canada had money taken out of their pockets for three weeks, and without any authority at all. The analogy between, that and the budget speech in parliament has been exploded here, and I need not explode it again. But what I want to say is this: We are coming to a situation where parliament is being asked to validate this action. I hope, whatever other action is taken with regard to this measure, whatever other defects are found in it, that it will be refused passage; but, if it is passed, then I hope this House of Commons will insist-and like the hon. member behind me I appeal to hon. gentlemen opposite that it be made retroactive only to December 5 last, when parliament met. If this House of Commons validates it from December 5 back to November 17, then all I can say is that thfy are condoning an act of lawlessness.

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An hon. MEMBER:

Rubber-stamp.

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PC

James MacKerras Macdonnell

Progressive Conservative

Mr. MACDONNELL (Muskoka-Ontario):

Yes, the expression "rubber-stamp" is used. But I am stating it is lawlessness, and it is lawlessness. There has been an expression used' by the minister; and with all my respect for him I have been grieved1 more than I can say that the minister seems to have considered this as a kind of joke. I am not holding the minister to the- words he used, but he said he would d'o it the next time by press release. I think the minister was a little perturbed at having said it, and afterwards, when he was pressed on the question, he was at pains to say that he was joking.

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LIB

Douglas Charles Abbott (Minister of Finance and Receiver General)

Liberal

Mr. ABBOTT:

I have to listen to so much in the course of the discussion that perhaps it is understandable that I become a little facetious at times.

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PC

James MacKerras Macdonnell

Progressive Conservative

Mr. MACDONNELL (Muskoka-Ontario):

I complain that the minister should consider as facetious something which is important. There is nothing facetious about it.

And one final reason, one final comment: W.e have been given one main reason in the fact that this great emergency arose and that parliament could not have been assembled in time to deal with it. What was the reason? The reason given the other night by the hon. member for Halton was the same reason, I think, that the Prime Minister gave in the house before Christmas, namely, that we could not show our hand and show our difficulty until trade treaties were passed. I think they were signed a day or two before November 17. Anyway, it was just before that.

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LIB
PC

James MacKerras Macdonnell

Progressive Conservative

Mr. MACDONNELL (Muskoka-Ontario):

I say that is a sharp reason. If we were holding it back so as not to give an account of what we intended to do, and so as to try to get other people to enter into agreements and then take them by surprise later on, then all I can say is that that is the kind of thing which, in business life, would be regarded as sharp practice and, indeed, I think I would be safe in saying that it would be sufficient to set aside an agreement entered into. Even if we did accept this reason, what earthly reason was there that parliament should not have been called some weeks before November 17 when the minister made his speech? The notice did not need to give chapter and verse for everything to be done; and if the notice had said that we would deal with a shortage of United States exchange, it would not have been telling anyone any secret. The world knew we were short of it by that time. So I

Excise Tax Act Amendment

say that the reason was utterly invalid, and that for no emergency the government has committed this act of lawlessness and now asks us to rubber-stamp it and to put it through.

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?

Some hon. MEMBERS:

Carried.

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?

Some hon. MEMBERS:

Question.

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Some hon. MEMBERS:

Eleven o'clock.

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March 18, 1948